Ballard v. Hsbc Bank Usa

• Citation: 6 N.Y.3d 658,848 N.E.2d 1292
• Parties: In the Matter of Diane BALLARD, Appellant, v. HSBC BANK USA et al., Respondents.
• Decision Date: 11 May 2006
• Court: New York Court of Appeals

848 N.E.2d 1292

6 N.Y.3d 658

In the Matter of Diane BALLARD, Appellant, v. HSBC BANK USA et al., Respondents.

Court of Appeals of New York.

May 11, 2006.

Offermann, Cassano, Greco, Slisz & Adams, LLP, Buffalo (Josephine A. Greco and Kevin P. Wicka of counsel), for appellant.

Phillips Lytle LLP, Buffalo (James R. Grasso of counsel), for HSBC Bank USA, respondent.

OPINION OF THE COURT

CIPARICK, J.

The issue before this Court is whether the failure of petitioner Diane Ballard to include a return date in a notice of petition constitutes a nonwaivable jurisdictional defect under Executive Law § 298. We hold that it does not and that respondent HSBC waived its right to challenge the alleged defect.

Following a determination by respondent Edward A. Friedland, Acting Commissioner of the New York State Division of Human Rights, petitioner Diane Ballard filed a petition in Supreme Court on July 23, 2004, seeking review, pursuant to Executive Law § 298, of that part of the order that was adverse to her.¹ Ballard's notice of petition left blank the return date as no justice had yet been assigned to the matter. Copies of the notice of petition and petition were served on respondents along with a letter from petitioner explaining that she would advise respondents of the return date when it was assigned. Two weeks later, on August 4, 2004, after a Supreme Court Justice was assigned to the matter, Ballard sent a letter to the Justice, copying the other parties, stating: "Based upon discussions with your Chambers, we would like to make this matter returnable before you on August 23, 2004, at 9:30 a.m."

The following day, August 5, 2004, respondent HSBC filed a cross petition specifying a return date of September 13, 2004 and stating that "[j]urisdiction is proper pursuant to Executive Law § 298."² On August 6, HSBC responded to Ballard's letter of August 4, stating in part:

"CPLR 403 requires that a notice of petition specify the time and place of the hearing and CPLR 7804 requires that the time be at least 20 days before the return date. As August 23 is less than 20 days from service of your letter the petition cannot be made returnable on that date. Moreover, HSBC's cross-petition is returnable on September 13, 2004, which is the next available return date . . . which is at least 20 days after the notice of cross-petition. . . . Accordingly, I request that you adjourn the return date of the petition to September 13."

HSBC did not raise an objection based on any alleged jurisdictional defect at that time. It was not until August 18, after the filing of the cross petition, that HSBC moved in Supreme Court to dismiss Ballard's petition for lack of jurisdiction and as barred by the statute of limitations, based on Ballard's failure to include a return date in her notice of petition. Ballard cross-moved for an order extending her time to serve the notice of petition and petition or to deem her prior service good and sufficient. Respondent Friedland served an answer and moved to transfer the matter to the Appellate Division pursuant to Executive Law § 298. The motions and the underlying petitions were then adjourned to October 18, 2004.

In what amounts to an advisory opinion, dated March 25, 2005, Supreme Court found that the court lacked subject matter jurisdiction, opining that based on the language of Executive Law § 298, petitioner's failure to include a return date on the notice of petition "implicates subject matter jurisdiction, not jurisdiction of the parties" (8 Misc.3d 521, 526, 793 N.Y.S.2d 903 [2005]) and transferred the matter to the Appellate Division as required by Executive Law § 298. HSBC then moved before the Appellate Division to dismiss the petition for lack of subject matter jurisdiction and as barred by the statute of limitations. Ballard opposed the motion arguing that the objections sounded of personal jurisdiction and that any such claim was waived. Thereafter, HSBC filed a second motion to dismiss on personal jurisdiction and statute of limitations grounds. The Appellate Division subsequently granted HSBC's motion stating only that the Court lacked subject matter jurisdiction. We granted Ballard's motion for leave to appeal and now reverse the Appellate Division and reinstate the petition.³

Executive Law § 298 allows any "complainant, respondent or other person aggrieved by an order of the commissioner" to "obtain judicial review thereof" in a special proceeding "initiated by the filing of a notice of petition and petition" in Supreme Court. Executive Law § 298 further states that:

"Upon the filing of a notice of petition and petition, the court shall have jurisdiction of the proceeding and of the questions determined therein, except that where the order sought to be reviewed was made as a result of a public hearing . . . the court shall make an order directing that the proceeding be transferred for disposition to the appellate division" (emphasis added).

CPLR 403(a) provides that "[a] notice of petition shall specify the time and place of the hearing on the petition and the supporting affidavits, if any, accompanying the petition."

Respondent HSBC argues that because section 298 requires the filing of a notice of petition and section 403(a) requires that a notice of petition must include a return date, petitioner's failure to specify a return date was a defect in her commencement of the special proceeding implicating subject matter jurisdiction, and the proceeding should be dismissed. HSBC further argues that Executive Law § 298 conditions subject matter jurisdiction "[u]pon the filing of a notice of petition and petition" and such requirement is a condition precedent to the exercise of such jurisdiction.

Petitioner contends that her filing was not defective, and that even if it was, it would constitute only a personal jurisdiction defect as to which HSBC waived its objection. She further contends that such a defect does not undermine the court's authority to hear the case.

"The question of subject matter jurisdiction is a question of judicial power: whether the court has the power, conferred by the Constitution or statute, to entertain the case before it" (Matter of Fry v. Village of Tarrytown, 89 N.Y.2d 714, 718, 658 N.Y.S.2d 205, 680 N.E.2d 578 [1997]). We have routinely held that technical defects in filings do not fall under the umbrella of subject matter jurisdiction when they do not undermine the constitutional or statutory basis to hear a case (see Matter of Fry, 89 N.Y.2d at 718-719, 658 N.Y.S.2d 205, 680 N.E.2d 578; see generally Matter of National Gypsum Co., Inc. v. Assessor of Town of Tonawanda, 4 N.Y.3d 680, 797 N.Y.S.2d 809, 830 N.E.2d 1137 [2005]; Harris v. Niagara Falls Bd. of Educ., 6 N.Y.3d 155, 811 N.Y.S.2d 299, 844 N.E.2d 753 [2006]).

Last year, in National Gypsum Co., we held that a notice of petition, in a special proceeding filed under RPTL article 7, was not "jurisdictionally defective" where "petitioner included a return date that was later changed by court personnel" — essentially "a `fictitious' hearing date" (4 N.Y.3d at 682, 683, 797 N.Y.S.2d 809, 830 N.E.2d 1137). We explained that because petitioner could not possibly include an accurate return date before a judge had been assigned to the action, "[a]ny other interpretation of the statute would be...